Life Skills SWOTA 2009 Thomas A De Coster

Life Skills SWOTA 2009 Thomas A. De. Coster, M. D. University of New Mexico Lobo Sports UNM

Acknowledgements • Dr. Robert Schenck, MD • Mr. James Mac. Gillivray, CFP • Mr. Brad Day, CFP Lobo Sports UNM

What percentage of orthopedic surgeons change jobs in the first 2 years of practice? A. 1% B. 4. 5% C. 10% D. 20% E. 40% Lobo Sports UNM

What is the most common reason for orthopedic residents to be dismissed from a program? A. Low OITE scores B. Poor surgical technique C. Personality conflict with the chairman D. Dishonesty E. Depression Lobo Sports UNM

Life skills • Financial –Orthopedic –Non-medical –Malpractice • Personal/personnel Lobo Sports UNM

• Many aspects What are Life Skills? – Family – Ethics • Partner, children, parents • More successful, greater importance • Who you are? • What do you stand for? – Practice • Many new concepts • Successful practice – Financial – Is not just good surgery • Investments, Savings – Are you going to work forever? Lobo Sports UNM

Why Life Skills Talk? Because residency does not teach it. • Residency is adult education » Much like the college athlete • You will have many distractions and temptations » In a long line of academic degrees • We tend to dismiss life skills • Residency focuses on the practice of orthopaedics » Not the private practice • Patient care and integrity issues are critical concepts – That is why indigent care is so important in training • Physicians clearly have problems » Financial, work load, delayed gratification Lobo Sports UNM

Personal • BALANCE • The non-orthopedic non-medical aspect of your life • TD “All of our friends were my medical friends until I joined a country club where I’m now known as Ginny’s husband. ” More balance Lobo Sports UNM

Personal • Individually defined » Decide what is important » Don’t let your job become you, unless you want that • Priorities » Family • Relationships outside of work » Lifestyle • Ramifications » Decisions are not isolate • Successful people make decisions based on the “big picture” Lobo Sports UNM

Ramifications • Spouse selection » Critical decision » 30% of married PGY-4’s divorce by 6 th year of practice • Focus on relationships outside of work » Throughout entire career • Satisfaction is often related to family • Divorce » Huge personal costs despite necessity • Will affect your entire life • Divorced spouse will have a lower standard of living • Will reduce the wage earner’s assets to zero Lobo Sports UNM

Marriage • TD “I observed a 75% divorce rate among orthopedic attendings. Most were married early and divorced by the first two years of practice. • People changed (grew apart) • No time to deal with little issues during residency so they became big problems Lobo Sports UNM

Ramifications • Divorce is starting over –Personally –Financially –Recognize the ramifications –Choose wisely –Make the effort to maintain the relationship Lobo Sports UNM

Moving (changes houses or cities) • Moving comes at a huge cost –Job –House –But moving is cheaper than divorce! Lobo Sports UNM

Professional Skills • Integrity is critical » mantra, “do the right thing” • Focus on providing care » Treat patients as family • Money will follow • Continued education » Always learning • learn from the people around you; residents Lobo Sports UNM

Professional success AAA • Availability • Affability • Ability- –Most important to you -Ability –Most important to others - Availability Lobo Sports UNM

Ethics • What you do when no one else is around • It is very easy to justify behavior Lobo Sports UNM

Thoughts on Professional Behavior: During and After Residency • Become well-rounded and well known for: –Conservative care –Good surgical technique –Good bedside manner, in and out of OR –Knowing your limitations Lobo Sports UNM

Humility • “He who humbles himself will be exalted” • “Let others admire your work. ” Seltzer • “Nothing ruins results like long term follow-up” Brown Lobo Sports UNM

Orthopaedic Residency • Great Specialty –Fun –Effective –Great future –Flexibility –Great peers –Equivalent to 10 million dollars –Welcome, you’re in the club Lobo Sports UNM

Residency • Think in 12 month blocks • Suggested approach • First 6 months –Acquire the skill set required for that year • Second 6 months –Focus on the next year Lobo Sports UNM

Skill set by PGY • PGY 1 • PGY 2 • PGY 3 • PGY 4 • PGY 5 learn to be a doctor learn orthopedic basics orthopedic skills and breadth learn what you don’t know become a team leader Lobo Sports UNM

Residency Most common mistake to be fired • DISHONESTY –Avoid temptations –Select good mentors • NOT low OITE scores –If problem-get help-you can do it Lobo Sports UNM

OITE and Board Examination • OITE » Written by the AAOS » A relatively good predictor of failing boards • 10 th percentile OITE, 90% chance of failing written boards » Keep an OITE library • Boards – Last three years exams with answers – OSAE examinations – OKO review » Written by the ABOS » Part I (written) and Part II (practice based) » A requirement for privileges, insurance panels Lobo Sports UNM

ABOS=American Board of Orthopaedic Surgeons • Know the rules –Example-practice start date September 1 NOT September 2! • Abide by them • Part 1 • Part 2 - Lobo Sports UNM

Board Examinations • Part I (written, July of PGY 5) –Study for the boards –Study with other graduates • Part II (2 years after Part I) – 6 month collection period –Present cases, much like indications conference –Dress conservatively (like going to your own funeral), have cases prepped and documented –A great experience once passed –Good for 10 years Lobo Sports UNM

Continuing Education AFTER residency • Critical for surgeons » Yet most people practice what the learned in residency • No such thing as a SLAP tear in 1989 • Participate in regular education » Rounds, courses, weekly conference • Find some structure experience after residency • Think outside the box » Spend time with another surgeon » Mini-sabbatical Lobo Sports UNM

Practice • The business of medicine » Learn about practice management » Residency training improving, but can’t be the focus • Choose your job wisely » Find a fair partner, call, little turnover • You can always quit, but costly » Read your contract and get professional advice » Try NOT to be the 60% • That change jobs in the 1 st two years » Interview (negotiate) at several jobs • You don’t get what you deserve but what you negotiate Lobo Sports UNM

Example First year of malpractice insurance • Typically the job will pay yours • They each pay $50, 000/yr • Perceived to be a $50, 000 benefit • Reality about $5, 000 benefit • Chances of suit being filed in the first six months is virtually zero Lobo Sports UNM

Understand the science of business • Business is a science • Learn the language • Understand the choices • Learn what works • Know what to avoid • Business is NOT evil Lobo Sports UNM

$5 M or $20 M of income? ? Your choice • Your orthopedic franchise is worth between $5 Million and $20 Million • If you have no good business sense and just muddle along you will still likely make $5 Million in your lifetime • If you pay attention to the science of business the exact same practice will produce $20 Million of income to you Lobo Sports UNM

$5 Million or $20 M? • $5 M for orthopedics – that’s a lot • $15 M more, from your practice, if you apply business principles- that’s a lot more • The business portion is worth three times as much as the orthopedic portion Lobo Sports UNM

Practice • Operative Dictations » Dictate immediately with CPT code terminology • Dictation is part of the operation • Name the bone • Don’t leave the OR prior to dictating. • Billings » Learn about coding-it’s important and often not well done • Phone Calls » Never regretted » RS “the only phone call I ever regretted is the one I did not make” Lobo Sports UNM

Personnel- the people you hire • Critical to your success • Give them Incentives • Part of the science of business but not the curriculum of medicine • Praise in public, criticize in private Lobo Sports UNM

Malpractice • Huge Impact » Psychological, physical, time, financial, family, professional, data bank, privileges » To you it is a disaster • To your lawyer it is income • Most claims are from unhappy patients » Felt weren’t listened to » You must demonstrate empathy to avoid suits Lobo Sports UNM

Malpractice • Can’t prevent entirely • But a lot can be done to minimize » Motto: – RS “Pay Malpractice premiums one day at a time or in one lump sum” » Avoiding claims • Conservative treatment • Patient education (draw out on paper, include risks) • Careful dictations, documentation, date and time • Talk to family in waiting room • Never lose your temper » If a claim • Don’t freak out, documentation and doing the right thing will carry you • Don’t make a mistake: alter records, denial, inadequate representation Lobo Sports UNM

Malpractice mistakes • 1. • 2. Altering the medical record Inadequate representation –Early » Notify insurance carrier » Panel –Late » Your lawyer appointed by someone else » Settling without your approval Lobo Sports UNM

Personal finance • Apart from your orthopedic franchise • How you manage your financial affairs. • TD “I never bounced a check until I started making money. I was making $125, 000 instead of $19, 000 so I thought I didn’t have to balance my check book. ” WRONG!!! Lobo Sports UNM

• Individually defined » Decide what is important » But just isn’t money and certainly not how much you earn – And it is not being cheap or a miser • Many facets » Savings/Accounting 101 » Debt » Delayed gratification • House, car, fun • Giving, charity Personal Finance » Retirement » Investing » Insurance » Taxes – Life, health, disability – Affect what you keep » Income – Cash flow determines everything Lobo Sports UNM

Savings • The first thing when you start MAKING money is to start SAVING money and NOT to start SPENDING money. • It’s easier to save when you are not as used to spending Lobo Sports UNM

Savings vs. Investing • Savings is money you earn but do not spend • Investing is one of things you do with savings – 40% of savings to very conservative – 50% to “investments” – 10” to “speculation” Lobo Sports UNM

Investment • An investment is buying an asset that is expected to produce income or appreciation • NOT gambling (that’s the 10%) • “I’m more interested in the return OF my money than the return ON my money” Twain • A fool and his money are soon parted. Barnum Lobo Sports UNM

Common mistakes • Not enough savings • Savings but investing way too conservatively • Savings but investing way too risky • Assigning all responsibility to someone else Lobo Sports UNM

Suggestions • Retirement account • House (after somewhat settled) –Generally protected from liability –Generally with tax benefits • Other-60% conservative Lobo Sports UNM

Investment portfolio • After house and retirement • 60 % conservative investment –Mutual funds • 30% growth –Individual stocks –Real estate • 10% speculative –Gold –Ostrich farms… Lobo Sports UNM

Personal financial mistakes that I have seen first hand • Buying a huge house immediately upon taking a job – More later • Whole life insurance Don’t do it –Buy term life and invest the rest –Buy whatever other “benefit” associated with whole life policy • Pyramid schemes • Nigerian email scam Lobo Sports UNM

Assets • Accounting Definition –Something of value ($ realized from potential sale) • Investment Definition –Something that PRODUCES income • Examples –Car- not an investment asset –House-only an asset if appreciation greater than maintenance cost –Dividend stock-dual asset Lobo Sports UNM

House • Don’t buy a big house immediately » Wait at least the first year • Rent and get to know your town/partners » Minimum 20% downpayment (avoid PMI) » Get liquid money BEFORE loan application » Only buy 2 X your salary • House costs 10% a year • Many will tell you otherwise » Your lender, realtor, spouse, … delayed gratification Lobo Sports UNM

Problem I have seen Home buying • 1. Buy a big house right away • 2. Buy a house in the wrong part of town –Saddled with debt –Moved shortly thereafter –Lost a lot of money –Didn’t realize it (airport expansion) –Practice location moved –Moved and lost a lot of money Lobo Sports UNM

Problems I have seen Home buying • 3. Wait to borrow money for down payment – Lender approval and review – Get the money in an account in your name early (before loan • 4. application) Discovery of bad credit – $10 Texaco bill-TD – Credit score • 5. Buy with low down payment expecting PMI to go away – Mortgage “Insurance” required if less than 20% down – Lasts the life of the mortgage Lobo Sports UNM

Problems • 6. Paying points –Offered as an option to lower interest rate –Almost never a good choice – 90% of loans are paid off early » Refinance for home equity » Refinance for lower interest rate » Property sold (moving) » You lose the benefit from paying points Lobo Sports UNM

Avoid High risk Investments • Commodities/Futures » Remember: risky investments are usually through ignorance of the subject • Limited Partnerships » General/limited partners • Tax Shelters » Don’t make investments for tax reasons • Precious Metals/Coins/Gemstones • Annuities – Don’t make investments for insurance purposes Lobo Sports UNM

Best Investments • Home Although remember the warnings • Mutual Funds » Instant diversification • Associated Retirement Plans » Matching funds are free money » Not the only investment • Government Securities – Larry Burkett, Investing Through Your Building Years Lobo Sports UNM

College Savings • Public vs. Private • $15, 000 vs. $42, 000 per year • Need to save/invest early • 529 funds –Tax deferred growth –Tremendous flexibility –Start in residency Lobo Sports UNM

Getting Financial Advice • Chose carefully » Financial Planner/Accountant • CFP, CLU, Ch. FC, PFS, CPA » Ask for references, interview, meet regularly » Team of advisors – Kiyosaki, Stanley & Danko • Be happy to pay » Drive a Lexus, but cheap out on financial advice? * » Fee only or commission based • Make your own decisions****** » Listen to advice, but decide yourself » Spouse has veto power Lobo Sports UNM

TD: Monthly lunch • Financial advisor • Lawyer • Neighbor • Other walks of life Lobo Sports UNM

Your own family Financial Schemes • 1. Don’t do it –Rarely profitable –You are generally considered affluent –They think you can afford the loss –Cause friction and ruin relationships –Guys who sue their son/daughter Lobo Sports UNM

Family financial schemes • If you do it –Gift –Example: RIMAGO » Risk Management for Golf » Stock » Gift to his kids Lobo Sports UNM

Personal loans from you to a friend or co-worker or employee • 1. • 2. Don’t do it If you do- consider return OF your money not ON your money because unlikely to make money • 3. Written document • 4. Start pay back immediately • 5. Penalty for late or balloon (incentive to repay) Lobo Sports UNM

Personal experience Loans • I borrowed money from parents for new house down payment. – 8% interest first year – 15% interest thereafter –Repaid in 1 year-OK • Sibling loans –Complicated relationships –? More harm than good-facilitate fiscal problems • Loaned money to OR tech, business deals. . . –Got back about half –Considered a gift Lobo Sports UNM

Final Financial Thoughts • Remember you have income not wealth* • Mistakes* » A smart man learns from his mistakes. » A wise man learns from the mistakes of others. » Bad experience leads to good judgement • House » No greater than 2 x of salary • No offer can’t wait till tomorrow* • Private Practice » Approach and apply business principles » Start saving immediately Lobo Sports UNM

Thank You • Suggested readings/references » The Richest Man in Babylon, George Clason » The Wealthy Barber, David Chilton » Millionaire Next Door, Stanley & Danko » Rich Dad Poor Dad, Robert Kiyosaki » You Can Negotiate Anything, Herb Cohen » How to Influence people, Dale Carnegie Lobo Sports UNM

SWOTA : 2010 Resident Course - Fundamentals of Fracture Care “LIFE PRINCIPLES BEYOND SCIENCE” Helpfulness of Material A) Worst B) Bad C) OK D) Good COMMENTS Please E) Best Lobo Sports UNM

SWOTA : 2010 Resident Course - Fundamentals of Fracture Care “LIFE PRINCIPLES BEYOND SCIENCE” Quality of Presentation A) Worst B) Bad C) OK D) Good COMMENTS Please E) Best Lobo Sports UNM